Tuesday, March 13, 2012

PayPal Revises Policies to Allow Legal Fiction

In a victory for free speech, PayPal today announced plans to revise their content policies to allow Smashwords writers full freedom to publish and sell legal ebooks.

I met with PayPal at their offices yesterday in San Jose. They outlined their proposed policy changes for me. I was impressed.

This is a victory for all writers and readers. It removes credit card companies, banks and payment processors from the business of censoring legal fiction. It creates a new precedent that should allow other payment processors who have previously discriminated against legal fiction to relax their policies.

It will make more fiction more available to more readers. It gives writers greater freedom to express themselves. It gives readers more freedom to decide what they want to experience in the privacy of their own imagination.

If you haven't followed the Paypal censorship saga, you can see how the campaign developed by reading my email dispatches to Smashwords authors, publishers and customers. They're archived in the Smashwords Press Room (see PayPal #1, #2, #3, #4, #5).

When I received the first email from PayPal February 18 with the ultimatum to remove certain erotica content or face loss of PayPal services at Smashwords, my first inclination was to try to limit the damage so we could protect mainstream erotica from further censorship incursion. Thanks to the outpouring of opposition to these policies, I saw an opportunity to make PayPal our partner in a greater campaign to protect all legal fiction from censorship.

Credit for this breakthrough goes to the indie author community who made phone calls, wrote letters and emails, blogged and tweeted; bloggers who raised visibility of the issue; advocacy groups such as the Electronic Frontier Foundation (EFF), The American Booksellers Foundation for Free Expression (ABFFE) and the National Coalition Against Censorship (NCAC) who were the first to stand up for our authors; mainstream media who raised visibility of the story to greater levels; and last but not least, PayPal. PayPal worked with us in the spirit of partnership to understand the issues, understand Smashwords and how we represent a new model for publishing outside the traditional gatekeeping system, and to understand that fiction is fiction and literary merit should be determined by readers.

I'm sending out an email today to all Smashwords authors and publishers with more details and thanks. An archived version is in the Smashwords press room here.

I have been proud to be a Smasher for several years. While erotica is not something I typically read, censorship in any form is abhorrent to me on both literary and legal grounds. You went to the mat for your authors, and I, for one, appreciate it more than I can say.

It seems to me that PayPal deserves some kudos, too. It must not have been easy for them to stand up to huge credit card companies and financial institutions in support of freedom of expression.

It's nice to know that some folks are looking out for our Constitutional freedoms.

Dear Mr Coker,That's such a great news. Thank you so much for everybody at Smashwords and elsewhere who worked so hard to make writing a free medium again.I am relieved and proud that Smashwords stood against Paypal and fought for our privileges.Even if I am not an erotica writer, I believe this cause was right.Congratulations and thank you so much for your efforts again.Kind Regards,

Mark, I never thought I'd see the day when you were quoted in the Irish Times but today you are! Well done in your stance against censorship - even though I have grave reservations about some of the contentious material it is not the role of PayPal to intervene. Let the readers decide.

Thanks Mark! Im glad that you follow your dreams and provide an engine to corner the market for indi authors. My book "The 50 Laws of Control: The Music Industry Edition" has really taken off because of your platform. Keep moving positively forward!

Thank you Mark. I don't read erotica, but censorship of legal writing is always wrong. And I'm behind the right for anyone to read any legal fiction.

But the problem is not just with fiction.

I've been posting about iBookstore's censorship of non fiction. They won't accept a non fiction or how to type book that links to, say, Amazon bookstore so readers may purchase further information on the topic.

They call it a restriction but it is just plain censorship when they claim to be a general book supplier, not some specialty supplier like Christian or New Age or Adult bookstores.

If they are going to continue this the law should require they state publicly that they are a specialty store selling only books that don't compete with anything Apple.

My last how-to wasn't accepted by iBookstore either. I never got a letter explaining why like Seth Godin did, but now I know it's because of linking to the Amazon store.

I do that for one simple reason -- none of the reference books I recommend to my readers to are available at iBookstore. Hmmm, maybe because they censor so strictly?

I wrote a short article about this, referring to Seth Godin recently being rejected at iBookstore: http://www.promotionalacarteblog.com/2012/03/apple-rejects-books-containing-links-to-amazon/

Thanks again for fighting and winning. If one book can be censored then all books can be censored.

I just wanted to say two things:1) I am a Christian and would not read several of the genres that were targeted here. However I believe passionately that censorship is a slippery slope, and while I may not agree with what other people read or write, they should have the freedom to read and write it!

2) Mark, I think you have handled yourself incredibly well throughout this whole situation. You have treated both Paypal employees and angry authors with respect, honesty, and integrity. THANK YOU for persisting in the face of professional and personal attacks and leading this cause. You have helped secure the freedom of not only Smashwords authors, but everyone across the net. This could have heralded the beginning of the end for true freedom of expression on the Internet, but instead it has become an example of how the "little guys" can stand together and influence the practices of the marketplace for the better. THANK YOU!

Thank you Mark,I'm impressed by the way you trod the slippery, knife-edged slope of we cranky authors and the intransigence of PayPal without once loosing your cool. That's what a successful CEO does for his business. But I think we must remain vigilant lest attacks from other entities desiring to limit free speech emerge. I'm glad to have Smashwords on my side and I have no desire to go elsewhere.

Excellent!Does this mean that 'legal' is going to be CLEARLY defined in the SW ToS, including what CAN and CANNOT be published?Right now, it is extremely vague and does not cover complex subjects such as incest, 'children', imagery, etc.

This topic should be the longest part of the ToS as it is exceptionally complicated and open to an infinite number of interpretations.

Was this really an overall victory, or is it going to open the floodgates for illegal material to appear all across the WWW?

I dealt with PayPal some 10/12 years ago over the same subject and I can vouch from experience that they are not the easiest company to deal with. Mark’s success at this level alone is a considerable conquest.Clearly, much more went on behind the scenes and this victory shows not only what exceptional entrepreneurial and communication skills can achieve, but also how an equable approach to business, combined with the fortitude to succeed, CAN indeed move mountains. Even as I write, this triumph is entering the literary history books.To plagiarize Margaret Mead: - “Never underestimate the power of one person to change the world.”

I DO write erotica (and make a good living at it, too), so for me, my publishing company and our band of merry authors, Mark’s doggedness and indomitable spirit served not only to maintain some of our income, but demonstrated that unity is strength.

Let us not rest on our laurels, however - there is much more of this saga to come and some of it will be repugnant. But for now, we can revel in the knowledge that through the resolve to succeed and pursue a dream, one man and his followers today achieved an outstanding success.A battle in a considerable ‘war’ has been won, and a voice representing indie publishing has been heard across the globe. Make of Mr. Coker what you will, but this does not deter from the fact that he kept his promise, stuck to his guns and has become an indie publishing representative of note.

From this day forward, writing and publishing as we know it has been indelibly changed. Some will say for the better, some will say for the worse. The fact remains, however, that the censorship of the single biggest-selling genre of our time, ‘erotica’, will be in the correct hands and not in those with merely pecuniary interests.I am all agog to see how this develops.

Thanks, all. Definitely a power to the people moment. Four years ago when I was working with a designer to design our logo, I referred to the upward thrusting fist holding the book as our "power to the people" fist. Our mission is all about empowering authors. The PayPal reversal could not have happened were it not for many many Smashwords authors, publishers and customers - including those with no personal interest in erotica - who stood up for their fellow authors and stood up for free speech. Anything is possible if we work together toward common cause.

@Meredith Rae Morgan Yes, I agree. PayPal went to bat for our authors. I think the uprising gave PayPal the motivation it needed to push back against the credit card companies, and it gave the credit card companies reason not to resist. The credit card companies saw how PayPal was getting so sorely beat up, and probably didn't want to suffer the same fate. In the end though, this is a win for PayPal and credit card companies too because they won't have to exert so much time and effort enforcing against legal fiction.

@Aggie - I view the issue with Seth Godin differently. We actually have a rule, explained in detail in the Style Guide, that Smashwords ebooks shouldn't contain advertisements for ebooks at other retailers. This is a rule based on fairness. It would be unfair to Barnes & Noble, for example, if we shipped books to them that promoted ebooks at Amazon or Apple, just as it would be unfair to Amazon to add a section at the end of your ebook that read, "Other books by this author" followed by links to the Apple iBookstore.

At Smashwords, we make an exception for print links to Amazon (or to any other print retailer) since most of our retail partners aren't in the business of print.

I haven't seen Seth's book, or the links in question that Apple objected to (we aren't his distributor), so there may have been other factors of which I'm unaware. I imagine if he said something like, "These books are available at leading ebook retailers," Apple would have been fine (as would we).

@Lynn And all non-Americans too! :) We represent the world's authors, not just American authors.

@ChulaSlim I like the knife-edged slope analogy. It felt that way at times. As we waged the campaign, I actually had "minefield" in my mind. That's how I described it to my family. I felt like I was trying to help authors across a minefield without anyone getting hurt along the way. Luckily, all indies pulled together and made it happen.

@living books: The Terms of Service, which we rolled back to its original state on Monday, already defines what's allowed and not. PayPal's original thrust was to ban incest, rape, bestiality and underage. Underage erotica has never been allowed at Smashwords, and underage is the only original area of PayPal's stated concerns that will remain in effect with their new policies. We support this. They also don't want pictures and images in erotica. We too have never allowed this, or at least not nude images in erotica. I doubt PayPal's decision will lead to an increase in this content, because their decision is already perfectly consistent with our previous rules. Ultimately, the marketplace will decide. It's very difficult, for example, to find true bestiality erotica at Smashwords, probably (I assume) because that's not what readers want to read or imagine or experience within the safety of fiction. If there was a bigger market for it, we'd probably see more.

@ Dr John: I didn't intend it as tongue in cheek. I wanted PayPal to be our partners in this. Here's what I think happened: PayPal at first tried to implement a mistaken, outdated policy not necessarily of their own making. The very first moment I reached a live person at PayPal to discuss their ultimatum - a customer support rep who just so happened to be a writer and a member of RWA who knew Smashwords - to the next people I spoke with, I made the judgement that these were good people and there was not an institutionalized policy inherent at PayPal that was attempting to moralize or restrict free speech. Instead, what I surmised - consistent with what they told me and what I communicated to our authors - was that here was a company trying their best to interpret and enforce the opaque rules of the credit card companies and banks upon which their service depended. It's important to remember that this indie ebook revolution is completely new to most people. Indies are pushing the boundaries of what once was considered literary merit. Now readers determine literary merit. The old gatekeepers - big publishers - aren't standing behind these books to defend them. In previous enforcement actions, the individual authors or smaller retailers either didn't have the power to question the rule, or didn't have the inclination to question it. I don't think they knew what they stepped into when they stumbled across Smashwords, because behind us are 37,000 authors and small publishers with an opinion or two about censorship. :) I came to to the conclusion that the true culprit was a game of telephone that originated at the credit card companies. The ccs created vague, opaque rules based on a pre-indie-ebook era (rules possibly intended to enforce against completely different risks associated with completely different products), then expected PayPal to interpret and enforce the the rules, then PayPal communicated their interpretation of the rules to Smashwords (rules equally vague and opaque) that we were then forced to interpret, communicate and enforce yet again. Our authors and publishers were then forced to interpret our interpretation of an interpretation of an interpretation. Insanity. Signal is lost in the game of telephone.

When PayPal called me the Monday after our first Friday announcement, I took their word that they wanted to work with us in good faith to navigate the issue. And that's what they did. They listened to us, our authors, and to advocacy groups like EFF, and opened their minds to a rapid education on legal fiction. I think early on, PayPal wanted to revise their rules just as much as our authors wanted them revised. So yes, I viewed it as a partnership. We, PayPal and our authors had common interests. Without PayPal as our partner, and without the credit card companies seeing how badly PayPal was being beaten up, I don't think PayPal could have gotten the credit card companies to stand down so quickly. Now it'll be interesting to see if other payment processors try to relax their rules. One remaining challenge for PayPal is that they don't have the resources to vet and approve every ebook that might want to be sold using PayPal. They know we have rules and processes in place to enforce our rules, so they have a comfort level with us, but it becomes more open ended elsewhere. Who knows, maybe everyone selling ebooks would be well-served to create their own terms of service that clearly identifies to PayPal or other payments services firms that they have policies and procedures in place to prevent the sale of illegal content.

@Aggie - I view the issue with Seth Godin differently. We actually have a rule, explained in detail in the Style Guide, that Smashwords ebooks shouldn't contain advertisements for ebooks at other retailers. This is a rule based on fairness. It would be unfair to Barnes & Noble, for example, if we shipped books to them that promoted ebooks at Amazon or Apple, just as it would be unfair to Amazon to add a section at the end of your ebook that read, "Other books by this author" followed by links to the Apple iBookstore.

I still see this as censorship because it is an impossibility for me to link my readers to iBooks as they don't carry the books my readers need to further their education in my book's topic. Nor does Smashwords.

Amazon doesn't carry these restrictions, I assumed because they are a general book seller like iBooks claims to be.

Quick personal question: I'm preparing to upload my new book to Smashwords and the title and topic of it is, "Amazon Categories Create Best Sellers." The book teaches how to use Amazon's built in marketing algorithms to sell more of your books.

Mark, I'm amazed you got them to change their minds. Kudos to you and my surprised congratulations to Paypal for recognizing that bankers weren't the people to be making moral decisions on what people could read or write.

Well done, sir. While I suspect a lot of PayPal's reversal may have had to do with their realization of all the $$ they'd be leaving on the table, your advocacy and cool handling of this crisis undoubtedly had an equal effect. This policy would never have been rolled back without your staunch championing of your writers and publishers. While this policy was in effect, I found it had a "chilling" effect even on my writing: although I do not write incest, I am setting a novel in ancient Egypt, when royalty routinely married close family members to one another. Without clear guidelines, I had no idea whether my book would fall under the ban, even though there is only one passing mention of brother/sister marriage in a historical context. That's the problem with, as you pointed out, a game of "Telephone" -- no one knew what was really "unacceptable", or who would be defining it, or enforcing it. What a nightmare! And your efforts have successfully dissipated that potential nightmare. Again, thank you for your hard work and your persistence!